Magazine Luiza (MGLU3) and Via (VIIA3) start the 2nd semester with losses of up to 8%; see what to expect

Magazine Luiza (MGLU3) and Via (VIIA3), two of the largest and most traditional retailers on the Stock Exchange, began the second half of the year as they ended the first: in decline.

The two stocks were once again among the biggest losses in the Ibovespa: Magazine Luiza fell 3.18%, to R$ 2.13, while the Via slipped 3.17%, to R$ 1.83.

In two sessions, Via fell 4.69% and Magalu 8.97%.

According to Idean Alves, partner and head of the trading desk at Ação Brasil Investimentos, the retail sector suffered once again due to the current context, with high interest rates and increased perception of fiscal risk.

Novelty in retail does not help action

The changes made by Via and Magazine Luiza in their marketplaces should help improve companies’ medium-term profitability, as they reduce subsidies but impact long-term growth, analysts at citi in this Monday.

In a report, they cite an increase of 2 percentage points by the Magazine Luiza in its commission on sales from retailers who opt for the prepayment model as of the 15th, in a movement that does not include fashion and accessories categories.

in the case of Viahighlight the decision to establish that payment to certain shopkeepers will be made in installments when the respective purchases by customers are made in installments and that it will offer advance payment (for four days after purchase) for shopkeepers who opt for the ‘fulfillment’ option – when The Via operates the entire process, from sale to delivery.

“In the long term, however, these changes should limit the growth of the marketplace for Via and Magazine Luiza, as other companies must take advantage of this opportunity to offer more competitive terms to retailers,” they said.

The information published by Citi was included in a report by the Friday’s Economic Value. wanted by ReutersO Magazine Luiza confirmed the changes to its platform for sales by third-party retailers, while Via did not immediately comment on the matter.

Is it worth investing in Magazine Luiza and Via?

Victoria Minatto, retail analyst at bendorfstates that with high inflation, consumer stocks tend to suffer more volatility, especially those most affected by the macro scenario, such as Via and Magalu, which have a higher average ticket (very dependent on white goods).

Minatto says that the fall of Magazine Luiza does not imply a “cheap” price for the shares. “The macro moment, both in Brazil and in the world, is not favorable for retail”, he emphasizes.

Minatto recommends buying companies that generate cash, pay dividendsand manage to “perform” well regardless of the scenario, “which is not the case with retail and, specifically, with the Magazine Luiza”.

According to the analyst activeLivia Rodrigues, the Magazine Luiza suffered from problems both in terms of demand, strongly impacted by the macroeconomic scenario, and in terms of competition, with greater pressure from foreign competitors.

See the biggest highs of the Ibovespa

See the biggest drops in the Ibovespa

With Giovana Leal and Reuters